A recent report from CoinShares revealed that Ethereum (ETH) experienced a surge in inflows last week, surpassing Solana’s (SOL) inflows for 2024. This surge coincides with the impending launch of exchange-traded funds (ETFs) that will enable regulated investment in the US for the second-largest cryptocurrency by market capitalization. The report highlighted Ethereum’s strong momentum over the past month, with inflows hitting $45 million last week and totaling over $103 million for the year, outpacing Solana’s inflows.
While Solana also saw significant inflows of $9.6 million during the same period, resulting in a year-to-date total of $71 million, it still lagged behind Ethereum. Among other altcoins, Litecoin was the only one to receive inflows exceeding $1 million, with $2.2 million recorded last week. The report also indicated that general digital asset investment products continued to attract buyers, with inflows totaling $1.35 billion last week. This three-week inflow streak reached $3.2 billion, contributing to the recent recovery in crypto prices.
The trading volumes of exchange-traded funds also saw a significant increase of 45% week-on-week, reaching $12.9 billion. However, these volumes only represented 22% of the broader crypto market volumes, indicating a relatively lower proportion. Bitcoin (BTC) recorded $1.27 million in inflows last week, while short-bitcoin ETPs witnessed outflows of $1.9 million. These outflows amounted to $44 million since March, representing 56% of the assets under management (AuM).
The Securities and Exchange Commission (SEC) is expected to fully approve spot Ethereum ETFs, paving the way for a new cryptocurrency investment vehicle in the US. Industry experts speculate that the approval of Ethereum ETFs will have a significant impact on the Ethereum blockchain and its decentralized finance (DeFi) protocol. James Seyffart, a Bloomberg ETF expert, anticipates the ETFs to begin trading soon and believes that this regulatory approval will attract billions of dollars in retail and institutional investor cash.
Mark Connors, the head of global macro strategy at Onramp, referred to Ethereum as the “middle kid protocol,” emphasizing the ETF launch as a crucial test for the DeFi ecosystem. The success and participation in the ETF launch will determine Ethereum’s ability to maintain its market standing, attract sustained interest, and drive increased inflows and adoption. These factors could significantly impact Ethereum’s price in the market.
The increasing inflows for Ethereum, combined with the impending launch of ETFs, signal a positive development for the cryptocurrency market. The approval of spot Ethereum ETFs by the SEC is expected to open up new investment opportunities and attract a significant amount of capital to the Ethereum ecosystem. As the market continues to evolve, it will be interesting to see how these developments shape the future of Ethereum and its role in the broader crypto market.
